Business intelligence was once the domain of statisticians and corporate analysts. Not anymore. BI capabilities are spreading to virtually all parts of the organization, as companies strive to put critical data into the hands of business users who need it to do their jobs.
The potential benefits of giving BI capabilities to more employees include productivity and operational gains, says Dan Vesset, an IDC analyst. "The productivity increase comes from the more efficient delivery of data—getting information to the right people at the right time," he says. "Many companies spend a large amount of time aggregating data and getting it to a form that's accessible to end users and then delivering it to them."
The potential gains include business process enhancements, increased customer satisfaction and cost reductions in areas such as sales and marketing.
Organizations that have broadly deployed BI are realizing some of these benefits. Sara Lee Household and Body Care, a division of Sara Lee Corp., began using QlikView Business Intelligence Software from QlikTech International AB three years ago to create a repository for sales data. Today, field salespeople, marketers and managers use the product to access a variety of information about customer interactions, buying trends, products and other data that drives sales.
The software has helped the division improve the accuracy and timeliness of demand forecasts for specific products in different locations, says Gary Kahler, director of sales and operations planning at Sara Lee in Exton, Pa.
Workers use the product to download BI data into Excel spreadsheets on their PCs, Kahler says. Managers at headquarters use the application, which runs on a Dell server, to compare regions by customer and product brands over different time periods, he adds. "It's simple enough for anyone in the company to use but powerful enough to answer any questions they can ask," he says. Kahler says the benefits of BI are too "nebulous" to measure. "We know inherently that we have efficiency improvements throughout the organization," he says. "People work much faster and more accurately, and they are able to do more than they did before. But it's very difficult to try to quantify the benefit."
A Head for Business
Education Management Corp., a Pittsburgh-based company that owns and operates career-oriented postsecondary schools in North America, uses BI products from Cognos Inc. and Hyperion Solutions Corp. to analyze surveys of students. Christopher Kowalsky, senior vice president and CIO, says about 250 managers in admissions, finance, education and other departments access the software to learn more about how Education Management is delivering services to students and how it can improve operations.
With BI, the company can analyze its financial performance, its ability to attract students and the success of new campus locations and acquisitions, Kowalsky says. Although users have had some training in quantitative analysis, they're business decision-makers rather than statisticians, he says. Users access the server-based BI applications via their desktop computers.
Kowalsky says Education Management isn't running metrics to determine the payback on BI technology and doubts that anyone can do this accurately because there are too many factors involved. But he says the company has an intuitive sense that BI has more than paid for itself because the technology supports critical business functions. "Without it, the business would not be profitable," he says.
Ed Chen, director of IT at public radio and TV broadcaster KQED Inc. in San Francisco, says the broad use of BI will more likely succeed if the technology is combined with common applications such as Excel. "One of the key things is usability. You have to make sure the system is easily learned and adopted," he says. KQED is in the midst of a six-month pilot program in which a sampling of employees are testing BI products, with plans to make BI widely available within the company. The broadcaster hopes to increase revenue by using BI to analyze promotional campaigns, more precisely target its programming and focus on viewers who are most likely to make financial contributions, Chen says. Avoiding Data Disasters
Along with the benefits come some risks. For one thing, users might load inaccurate data into databases and not understand the relevance of BI data. "It's important that people be trained properly and have a good command of the technology," says Kowalsky.
Kahler agrees. He says companies must ensure that workers understand how to use BI applications so that they don't draw the wrong conclusions from data because they submitted the wrong queries or misused the results.
"BI is not overly complex, but it's so powerful that it has to be used with care," he says. "There are learning phases people have to go through to make sure they're getting the information they thought they were getting."
For example, if a financial services employee misunderstands data about which segment of the customer base is most likely to order a certain service, it could result in time and money wasted on a marketing campaign that's aimed at the wrong customers.
One of the biggest challenges is managing user expectations, says IDC's Vesset. "When you open BI to the masses, people get a taste of what they can do and start demanding more and more information and analytics," he says. "In some cases, the IT department can't keep up with the requests." Vesset says there might also be technical issues to deal with, such as integrating BI applications with existing business systems.
Organizations must also guard against giving BI tools to too many people, says Shaku Atre, president of Atre Group Inc., a consultancy in Santa Cruz, Calif. If too many people use the system, companies can run into problems maintaining resources and controlling usage and application performance. There are also security concerns to consider, including the possibility that customer data could be compromised. "Once information is made available to the masses, if the proper controls are not in place, there's a risk of data falling into the wrong hands," says Atre. "Because of the Internet, information could be misused. This is something you have to be very careful about." For example, health care organizations must secure patient information to comply with the Health Insurance Portability and Accountability Act. Companies must also guard against critical information getting into the hands of competitors because so many people have access to it, says Dipendra Malhotra, Atre Group's chief technology officer.
BI will grow in popularity as vendors link its capabilities with familiar tools such as spreadsheets, Atre says. "If you want to provide something for the masses, look at what is already being used by the masses," she says.
Atre says companies that roll out BI broadly can expect to reap benefits such as reduced costs, increased revenue and higher customer-retention rates. A salesperson using BI could determine which customers are most likely to buy certain products, and product developers could have greater insight into which products and features bring in the most revenue.
Will risks slow the deployment of BI to the masses? Not likely, experts say. The potential benefits of providing strategic information to many employees outweigh the risks. "In the past, only the elite few had access to business intelligence," says Howard Dresner, a vice president and research fellow at Gartner Inc. "We're really starting to see information democracy take hold, and that's giving everyone the insights they need."
Violino is a freelance writer in Massapequa Park, N.Y. Contact him at bviolino@optonline.net.
 |
|
|
The Future of BI
Stories in this report:
- Editor's Note: The Future of Business Intelligence
- BI for the Masses
- Text Mining Tools Take on Unstructured Data
- Fraud Sniffers
- Web Harvesting
- Resources for More Information on Web Harvesting
- Web Harvesting and Libraries
- Doubtful BI
- Predictions for BI's Future
- Shark Tank: Tales of Business Un-Intelligence
- Four Steps to Get Your Data In Shape
- When Good Data Goes Bad
- Managing Data Madness
- Securing Business Intelligence